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Business Combinations
 3 Months Ended
Mar. 31, 2026
Business Combination [Abstract]  
Business Combinations

3. Business Combinations

SciTec

On October 31, 2025, the Company completed the acquisition of all of the outstanding capital stock of SciTec for a purchase price of $550.3 million, consisting of $277.4 million in cash, net of cash acquired, $269.6 million in common stock, and a $3.3 million post-closing working capital adjustment (which was accrued as additional cash consideration payable and included in accrued expenses as of March 31, 2026). SciTec has over four decades of experience and offers industry-leading AI-enabled defense software applications and big data processing capabilities in the forms of cloud-based, on-premise, and edge processing of high volumes of data from satellites across all orbits that are complementary to Firefly's launch, lunar, and in-space vehicles. This acquisition is expected to complement the Company's full-service hardware and software offerings to space and defense customers. SciTec is based in Princeton, New Jersey, and has facilities in Boulder, Colorado; El Segundo, California; Fairborn, Ohio; Huntsville, Alabama; and Herndon, Virginia.

The acquisition was accounted for as a business combination under ASC 805, Business Combinations, with the Company identified as the acquirer. The purchase price allocation as of the date of acquisition was based on a preliminary valuation and is subject to revision as more detailed analyses are completed and additional information about the fair value of assets acquired and liabilities assumed becomes available during the measurement period, a period not to exceed 12 months from the acquisition date. In connection with the acquisition, the Company incurred acquisition-related costs of $24.4 million, which were expensed as incurred on the date of closing.

The table below sets forth the consideration paid, the fair value of the assets acquired, and liabilities assumed at the acquisition date, as well as the measurement period adjustments recorded as of March 31, 2026:

 

 

Acquisition Date Amounts Recognized as of October 31, 2025

 

 

Adjustments

 

 

Acquisition Date Amounts Recognized, As Adjusted as of March 31, 2026

 

Consideration

 

 

 

 

 

 

 

 

 

Cash, net of cash acquired

 

$

277,417

 

 

 

—

 

 

$

277,417

 

Net working capital adjustment

 

 

—

 

 

 

3,321

 

 

 

3,321

 

Equity (issuance of common stock)

 

 

269,556

 

 

 

—

 

 

 

269,556

 

Total consideration, net of cash acquired

 

$

546,973

 

 

$

3,321

 

 

$

550,294

 

 

 

 

 

 

 

 

 

 

 

Assets acquired and liabilities assumed

 

 

 

 

 

 

 

 

 

Short-term investments

 

$

8,413

 

 

$

—

 

 

$

8,413

 

Accounts receivable

 

 

45,769

 

 

 

—

 

 

 

45,769

 

Other current assets

 

 

1,962

 

 

 

—

 

 

 

1,962

 

Property and equipment

 

 

7,718

 

 

 

—

 

 

 

7,718

 

Right-of-use assets

 

 

2,276

 

 

 

—

 

 

 

2,276

 

Intangible assets

 

 

153,000

 

 

 

—

 

 

 

153,000

 

Goodwill

 

 

433,022

 

 

 

3,321

 

 

 

436,343

 

Total assets

 

 

652,160

 

 

 

3,321

 

 

 

655,481

 

 

 

 

 

 

 

 

 

 

 

Accounts payable

 

 

11,178

 

 

 

—

 

 

 

11,178

 

Accrued expenses

 

 

49,780

 

 

 

—

 

 

 

49,780

 

Operating lease liabilities, current

 

 

711

 

 

 

—

 

 

 

711

 

Deferred revenue

 

 

1,770

 

 

 

—

 

 

 

1,770

 

Other current liabilities

 

 

840

 

 

 

—

 

 

 

840

 

Operating lease liabilities, non-current

 

 

3,716

 

 

 

—

 

 

 

3,716

 

Deferred tax liabilities

 

 

37,192

 

 

 

—

 

 

 

37,192

 

Total liabilities

 

 

105,187

 

 

 

—

 

 

 

105,187

 

Net assets acquired

 

$

546,973

 

 

$

3,321

 

 

$

550,294

 

The fair value of the property and equipment, and working capital items including accounts receivable, other current assets, accounts payable, accrued expenses, and other current liabilities, approximates their respective carrying values at the date of the acquisition, as well as the adjustments recorded during the measurement period. Operating lease liabilities were remeasured at the present value of the remaining lease payments using the Company's incremental borrowing rate as of the acquisition date. The corresponding right-of-use assets were measured at an amount equal to the remeasured lease liabilities.

The following table summarizes the fair value of acquired identifiable intangible assets at the date of the acquisition:

 

 

October 31, 2025

 

 

Weighted-Average Life

Trade name and trademarks

 

$

18,000

 

 

5 years

Developed technology

 

 

74,000

 

 

10 years

Customer relationships

 

 

61,000

 

 

3 years

Total acquired intangible assets

 

$

153,000

 

 

 

On the acquisition date, trade name and trademarks, developed technology, and customer relationships are classified as finite-lived intangible assets and are subject to annual impairment assessments under ASC 350-30-35-18 through 35-20.

The fair value of the acquired intangible assets, including trade name and trademarks and developed technology was determined using the relief from royalty method, while customer relationships were determined using the multi-period excess earnings method. Significant assumptions used in the determination of the fair values include forecasted revenue growth rates, assumed royalty rates and the market-participant discount rate. The useful life used in the valuation analysis was based on the economic life of each intangible asset. The Company assessed the economic useful life of these intangibles and concluded that these periods will be used as the amortization periods going forward.

In consideration of the nature of the amortization, management has concluded that the most appropriate way to reflect the economic benefits of the pattern in which the benefits are realized is to reflect the amortization in a manner consistent with the cash flow build up by period reflected in the valuation report.

In determining the useful lives and amortization policy to apply to the intangible assets acquired, the Company assessed the pattern in which the economic benefits of the assets are consumed. Based on this assessment, the Company amortizes its intangible assets based on the methodology that approximates the pattern in which it expects to benefit economically from these acquired intangible assets. The useful life is also derived from the time period over which the majority of the cash flows are expected to be generated. The Company will employ the useful lives identified through this exercise and amortize amounts using the economic consumption of the intangible asset over the accounting useful life for amortization of the associated intangible asset.

Goodwill generated from this business combination is primarily attributable to expected synergies from the transaction and incremental revenue and profit to be derived from the Company’s expansion into full-service hardware and software for its space and defense customers. The goodwill is not expected to be deductible for U.S. income tax purposes.

Unaudited Pro Forma Information

The following unaudited pro forma financial information presents the combined results of operations as if SciTec had been acquired as of the beginning of fiscal year 2025. The unaudited pro forma results include certain adjustments to revenue and net loss directly attributable to each acquisition, including transaction costs.

For the SciTec acquisition, transaction costs of approximately $29.6 million are assumed to have been incurred on January 1, 2025 and recognized during 2025, of which $24.4 million were incurred by SciTec and $5.2 million were incurred by the Company.

The unaudited pro forma financial information is presented for informational purposes only and is not necessarily indicative of the consolidated results of operations of the combined businesses had the acquisitions actually occurred at the beginning of the respective periods, nor is it indicative of the future results of operations of the combined businesses.

 

 

For the Three Months Ended March 31, 2025

 

Pro forma revenue

 

$

98,198

 

Pro forma net loss and comprehensive loss

 

$

(88,827

)

Pro forma net loss per common share – basic and diluted

 

$

(7.51

)